Oil jumps on Middle East worry; U.S. stocks advance
By Chuck Mikolajczak
NEW YORK (Reuters) - Oil prices climbed to their highest levels of the year on Thursday as tensions in the Middle East sparked supply concerns, while the boost from energy-related stocks helped U.S. equities shrug off a batch of soft economic data.
Brent crude LCOc1 touched a high of $65.13, its highest since December, and was last up 3.6 percent at $64.97 a barrel, while U.S. crude CLc1 jumped 3.1 percent to $57.92 after Saudi Arabia and its allies continued a bombing blitz in Yemen that raised concerns about the security of Middle East oil supplies.
A 1.2 percent rise in energy shares .SPNY helped boost U.S. equities, with the Nasdaq above its record closing high of 5,048.62. Strong earnings from AT&T (T.N: Quote), up 4.2 percent to $34.25, and eBay (EBAY.O: Quote), up 3.3 percent to $58.65, also helped offset a round of lackluster domestic economic data.
"Oil prices are going to continue to remain somewhat volatile, although if you look over the last three or four weeks, what has changed in terms of fundamentals is we have seen U.S. production start to level off," said David Lefkowitz, senior equity strategist at UBS Wealth Management Americas in New York.
"Now we are still oversupplied in the near term but the market is beginning to see the light at the end of the tunnel in terms of a better balance between supply and demand."
The Dow Jones industrial average .DJI rose 83.56 points, or 0.46 percent, to 18,121.83, the S&P 500 .SPX gained 10.4 points, or 0.49 percent, to 2,118.36 and the Nasdaq Composite .IXIC added 24.21 points, or 0.48 percent, to 5,059.38.
European shares slipped, with Germany's DAX index underperforming following a disappointing purchasing managers' survey, while weak results from Ericsson (ERICb.ST: Quote) hit technology stocks.
Overall, euro zone private-sector business growth was weaker than forecast, despite help for exporters from a big fall in the euro and the March launch of a sovereign bond-buying program by the European Central Bank. Continued...